What were they waiting for?

June 13, 2005

Last week, Atari announced that its’ CEO, James Caparro was leaving the company to join Glenayre Technologies (GEMS). Caparro’s resignation — after only 7 months on the job — sent Atari’s stock down. But it wasn’t exactly a big surprise given that Glenayre disclosed in an SEC filing the previous Friday that it had hired Caparro. Indeed, Glenayre’s filing on June 3 included an employment letter to Caparro dated May 9 and noted that Caparro was required to give 30 days notice to Atari. Coincidentally, that was the same day that a company called Entertainment Distribution Company, which was founded by Caparro in 2003, announced that it has been acquired by Glenayre. Even stranger is that while Atari put out a press release announcing Caparro’s resignation last Tuesday, it waited until Friday to file the 8-K.

Based on Glenayre’s filings, it must have really wanted Caparro as well as Thomas Costabile, a colleague of Caparro’s from his days at music label Warner Elektra. As CEO at Glenayre, Caparro will be paid $750K, or nearly twice as much as Clarke Bailey was making as Chairman and CEO of the company. He’s also getting a $215K signing bonus from the Georgia-based company. As Chief Operating Officer, Costabile will also make more than Bailey did last year and receive a $200K signing bonus.

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